Getting startup business accounting right is essential if you want to set yourself up for success.
Good financial management won’t just make it easier for you to stay compliant — it can also save you time, money and stress in the long run. Here’s what you need to know to get started.
How to get startup business accounting right
Set yourself up for success
Don’t fall at the first hurdle — good startup business accounting should begin on day one.
That means deciding on your business structure early on. Perhaps the simplicity of becoming a sole trader appeals to you — or maybe you’d prefer to incorporate your startup business to open up more tax planning opportunities.
Your choice will affect your tax liabilities and the way you manage your finances, so weigh up your options carefully.
Check up on your responsibilities
Once you’ve settled on a structure, you’ll need to familiarise yourself with your reporting obligations and other responsibilities. Do you need to register for for self-assessment? What about corporation tax — and when do you need to worry about filing your returns and claiming business expenses?
Understanding your duties as a business owner and keeping a close eye on important dates and deadlines can help you get startup business accounting the first time round.
Put a good accounting system in place
Every new business needs a solid accounting system in place — but what does that look like?
First things first, set up a business bank account — this will help you keep your business and personal finances separate.
You’ll also need to stay organised. When we say hold onto everything related to your business transactions, we mean everything! That includes all your:
- bank and credit card statements
- bills
- invoices
- receipts
- financial statements
- tax return documents.
Ensuring your records are always accurate and up to date can help you budget more effectively, but the process can be difficult and time-consuming — particularly if you’re a brand-new entrepreneur.
Hiring a qualified bookkeeper to stay on top of your books may free up more time for you to actually run your business. We’d also recommend making the most of cloud accounting software.
Embrace cloud accounting technology
Signing up for cloud accounting software is a no-brainer for startups. Online accounting allows you to access and update key financial information whenever you need, making it easier than ever to keep track of spending.
That’s not all. With your real-time data at your fingertips, you’ll be able to create cashflow forecasts, profit and loss statements and other financial reports at the click of a button.
You don’t need to be an expert to use software like Xero or QuickBooks, but booking a cloud accounting training session with an accountant can help you make the most of it.
Work with experts from the beginning.
While it may be tempting to take on all your accounting tasks by yourself, even the most seasoned business owners need to access financial expertise now and then.
Need support with getting your startup off the ground? They can help you set realistic goals and discuss your funding options. Want to make better business decisions? They’ll draw up in-depth financial reports and budgets to help you understand your startup inside and out.
A great startup accountant will do much more than handle your routine bookkeeping tasks or prepare your statutory accounts — they’ll add value to your business.
Get in touch with us to find out how we can help you get startup business accounting right from the very start.